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Few Takers for Voluntary Subsidy Cut

A click on the yaraneh10.ir website for filing a complaint on subsidy cut will bring one face to face with the catch phrase: “By waiving your right to receive cash subsidies, guarantee the future of our children.”

But it seems that only a few take it seriously. Because even high income earners believe that receiving a monthly subsidy of $14 is their indisputable right, an article in Tabnak News Agency says.

Ali Rabiee, minister of cooperatives, labor and social welfare pointed out that an individual who owns a $ 52,000 car referred to the department “to complain about his subsidy cut.”

A short while later, deputy of the Management and Planning Organization (MPO), Alireza Saleh, said “a third of Tehran’s billionaires whose subsidy (‘yaraneh’ in Farsi) was cut, have referred to the Subsidies Organization, seeking reinstitution of their ‘yaraneh’.

The website is open from May 26 till June 10, “for the aggrieved.”

Saleh said the government has cut subsidies of only 50,000 high income earners in Tehran, including some physicians, who raised their complaints in the social media.

The people’s attitude clearly explains why the government’s policy on ‘voluntary subsidy unsubscribing’ failed earlier in March 2014. Only a few people voluntary waived their right to receive subsidy.

The government’s plan now to unsubscribe high income earners from the ‘yaraneh scheme’ makes sense, but when billionaires protest so strongly, what will happen if the subsidy of the middle-income group is mistakenly cut, the article asks.

Exceeds Population

Official figures say that at the beginning of the new government’s tenure, the number of subsidy receivers was 400,000 in excess of the national population, indicating that “even those who are in their graves may not have been eliminated from the list of beneficiaries.”

At present, one-third of the rich in Tehran have protested against their subsidy cut. Many officials believe that from the start, the subsidy plan had flaws, since covering all Iranians in the first place was erroneous.

Further, the subsidy payments are not permanent and should end after a certain period of time “after price stability and empowering vulnerable groups who are constantly affected by high prices of basic necessities.”

Assurance

“At present, we have eliminated only less than one million people from the list of the total population of 76 million who receive monthly subsidy,” said Saleh. “But some sections have protested strongly as if the subsidy of half the needy population has been cut.”

President Hassan Rouhani and other top officials “will not cut or reduce subsidies of the low-income groups,” he assured.

The targeted subsidy plan, also known as the subsidy reform plan, was passed by the Majlis (parliament) on January 5, 2010. The plan has been described as the “biggest surgery” to the nation’s economy and “one of the most important undertakings in Iran’s recent economic history”.

The goal of the subsidy reform plan is to replace subsidies on food and energy (80% of total) with targeted social assistance, in accordance with the five-year economic development plans, as part of the broader economic reforms.